Which Statement Describes Inflation Targeting

question 165

Multiple Choice

Which statement describes inflation targeting?

• A) Inflation targeting looks at past inflation rates to make a prediction.
• B) Inflation targeting is based on a forecast of inflation.
• C) Inflation targeting responds to changes in government expenditures.
• D) Inflation targeting is no longer used by the Bank of Canada.

---

Definitions:

Private Securities Offerings

The sale of securities to a relatively small number of select investors as a way of raising capital, without the need to register with the Securities and Exchange Commission.

Underwriters

Professionals or entities that assess and undertake the risk of another party, often in insurance policies or issuance of securities.

Investment Banking Firms

Financial institutions that provide advisory services and capital raising strategies for corporations and governments.

Shelf Registrations

A regulatory provision that allows an issuer to register a new issue of securities without having to sell the entire issue at once.